Bull’s Eye Report: Alliant Techsystems (ATK)

Defense stocks have been strong performers all year

At StateoftheMarkets.com, we strive to “own the best and ignore the rest” in our equity portfolios. Toward this end, each day we search our database for a “top stock” (a top rated company in terms of earnings strength as well as company and industry performance) that presents a strong technical “set up” and a good entry point.

In short, when our equity team is looking to add a stock to one of our portfolios, the “bull’s eye” stock shown below is generally their first choice.

Company

Symbol

Industry

Stock Rating

YTD% Gain

S.T. Stop Loss

Alliant Techsystems

ATK

Aerospace & Defense

9.9

+58.53%

$94.81

Why We Like The Stock:

Alliant Techsystems (ATK) is our most compelling buy today due to the fact that it is a top-rated stock (in terms of earnings strength and company/industry performance) with a strong technical set-up. Aerospace and defense has been the place to be in 2013, as evidenced by strength in stocks like Boeing (BA), Lockheed Martin (LMT), and ATK. ATK has been straight up since mid-July of 2012, rarely pulling back throughout its stunning run. Currently, we have a rare opportunity to pick up a high-flier at a good price, as the stock has spent the last week of August and all of September consolidating, forming a base just north of $95. We would not give ATK a long leash due to its extended set-up, but all signs point to it being good for a short-term fun back to its late-August highs of $103.77. We would be buyers at current prices.

We Would Be Buyers:

At the current price (~$97.51).

Company Profile:

Alliant Techsystems is an aerospace, defense, and commercial products company that operates in 22 states, Puerto Rico, and internationally. The company operates in four segments: aerospace systems, armament systems, missile products, and security and sporting. The company is a producer of military small-caliber ammunition for use in soldier-carried weapons, such as automatic and semi-automatic rifles, and machine guns. ATK is also a producer of medium-caliber ammunition used by tanks. In addition, the company is a producer of ammunition for the sport enthusiast and law enforcement markets. ATK is a manufacturer of solid rocket motors, supporting tactical, strategic, missile defense, and space launch applications. In June 2013, Alliant Techsystems Inc announced that it has completed the acquisition of Caliber Company and Savage Sports Corp.

Stock Rating: 9.9

The Stock Rating indicates the combined score of our proprietary Earning Strength and Company Performance models. The rating scale is 0 – 10 with 10 being the highest.